What are daily active users?
Daily active users (DAU) is a metric that measures the number of unique users interacting with a mobile app within a 24-hour period. DAU reflects user engagement and retention and is used to determine the lifetime value (LTV) of an app.
“Active” is a subjective term that individual companies can define for themselves. One company might define “active” as opening the app, another as logging in, and another as making an in-app purchase. As a general industry term, active usually means a user has downloaded or opened the app.
A daily active user is identified with an IDFA (identifier for advertising) or other IDs, and information a company collects via email, cookies, or from a user opting in on their mobile phone.
DAU benefits and limitations
Daily active users are typically considered a vanity metric — one that shows a snapshot of success.
Imagine a celebrity shares a link to your app on their social media. You get 100,000 new users downloading your app to check it out. Your DAU goes way up. This is exciting! But those 100,000 downloads don’t tell you much except for your success on that one day. However, inflated DAU’s that aren’t repeatable aren’t a good gauge of what engagement looks like on your app every day. It’s more of a reflection of press than overall or sustained success.
DAU isn’t a key metric in every industry. It only makes sense for businesses where users actually use the app on a daily basis, like news, social media, or gaming. And, because every company can define “active” however it wants, no one is comparing apples to apples industry-wide, making metrics like DAU unhelpful on their own.
This is not to say you shouldn’t measure DAU. It’s just more helpful if used in tandem with other metrics, or as the building blocks for other metrics.
DAU helps to gauge an app’s “stickiness,” or the regularity users engage with it. Measuring monthly active users (MAU) or even weekly active users also indicates stickiness, but over a longer period of time. The best metric to gauge consistent engagement and retention, though, is the DAU/MAU ratio.
The DAU/MAU ratio is calculated by dividing the number of daily active users by the number of monthly active users over a given time period. It measures the proportion of monthly active users who engage with the app on a daily basis. In other words, it measures how well your app retains returning users, giving you a more accurate view of interaction with your app.
Generally, a DAU/MAU ratio above 50% is considered good. It means that approximately 50% of monthly active users engage with the app daily. By tracking the DAU/MAU ratio overtime, brands can better understand and benchmark their app’s stickiness and growth potential.
Most companies want to measure a user’s lifetime value (LTV). LTV is an indicator of the total revenue a business can expect to generate from an individual user. To do this, you need to calculate user retention rates, which rely on DAU.
Bottom line: DAU is crucial to measure, but it’s not indicative on its own.
Strategies to boost DAU
There are several ways to achieve an uptick in their daily active users. In today’s complex digital ecosystem, brands need a multi-pronged user acquisition strategy that focuses on acquiring app users from every touchpoint they interact with. Here are a few examples of proven tactics:
- Remind your user base to use your app via emails, texts, or push notifications. With so many apps available to consumers, it’s easy for them to get distracted or forget yours exists. Continuous app promotion is critical for getting users to tap “download.”
- Optimize your app for visibility in the app store. App store optimization (ASO) is a key component of any app growth strategy, as it determines whether users can easily find your app in the Apple App Store or Google Play Store.
- Remove barriers to entry. If it’s too onerous to sign up, sign in, click through or scroll around, people won’t use your app. Use deep links to make the transition from other marketing channels like email, SMS, or search engine results pages (SERPS) seamless and convenient for users.
- DAU is just one metric to gauge interaction with your app. Evaluating it over the long term can help you determine the success of campaigns and customer experience.
- DAU is best used as an input for more indicative KPIs like lifetime value, churn rate, and retention rates.